2010-04-29

47% of People Pay No Income Tax

Short version: Both parties have instituted policies that have raised the percentage of people that pay no income tax. Generally, these policies are to incentivize work. Finally, the Stimulus Act has temporarily raised the number from 38%, and those provisions expire this year. Next year, we'll be back at that more moderate number of 38%.

And always remember that those people who pay no income tax still pay an effective tax rate of 15-20% on money they make. That's lower than the effective rate paid by many millionaires.